Claims Management Regulator fines “The Hearing Clinic” £220,000

What happened: The Claims Management Regulator (“CMR”), an arm of the Ministry of Justice, licenses firms and individuals to provide claims management services. It also has the power to take action when a regulated claims management business breaks the Conduct of Authorised Persons Rules.

Since December 2014 the CMR, based in Burton-on-Trent, has had the power to fine transgressing firms up to 20% of their annual turnover as well as suspending or revoking their trading licence. Up until this case, it had not exercised its new fining powers.

The CMR received hundreds of complaints from recipients of speculative calls by “The Hearing Clinic” about claims for noise induced hearing loss. Many complainants had previously subscribed to the “do not call” Telephone Preference Service, so the calls breached the Privacy and Electronic Communications (EC Directive) Regulations 2003.

Having investigated, the CMR imposed a £220,000 fine on Aurangzeb Iqbal, the Derby-based proprietor of “The Hearing Clinic” and it appears, various other businesses including “Industrial Disease Services,” “Hedging Redress,” and “We Claim 4 U.”

Various conditions were also imposed which applied to all claims management services operated under Mr Iqbal’s CMR licence.

These included having to inform the CMR on the 5th of every month of each TPS complaint received over the previous month. Mr Iqbal also has to provide the CMR with full details of all subcontractors he proposes to appoint, plus an explanation and evidence of how he proposes to monitor these suppliers to ensure their compliance.

Why this matters: In its press release, the CMR reported that from a peak of 3367 in 2011 the number of claims management companies has now fallen to 1752, with 105 having their licences removed in 2014. Further investigations by the CMR are apparently ongoing and could lead to more sanctions.

Given that The Hearing Clinic had apparently bombarded people with millions of nuisance calls, the question might be asked as to what a claims management business has to do to lose its licence.

Also, now that another enforcer has waded into the nuisance call bear-pit wielding a big stick, it is less clear where the demarcation lines are drawn between the Information Commissioner’s Office, Ofcom, Trading Standards and the CMR. Perhaps we should be told.